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2023 Supreme(Online)(DEL) 1392

W.P.(C) 16588/2022 & connected matters

Page 1 of 8

$~2,7,17 to 19, 20,21,37,38,39,50,51,53,54 & 55

*

IN THE HIGH COURT OF DELHI AT NEW DELHI

+

W.P.(C) 16588/2022 & CM APPLs.52144-45/2022

MS GRAND MUMTAZ HOTEL AND RESORT THROUGH ITS

MANAGING PARTNER MR WASIM MUSHTAQ ..... Petitioner

Through:

Mr.

Shekhar

Dasi, Advocate (M:

9871655327).

versus

DEPUTY COMMISSIONER NORTH EAST GOVERNMENT OF

NCT OF DELHI & ORS.

..... Respondents

Through:

Ms. Mehak Nakra, ASC with Mr.

Karan Kapur, Advocate for R-1 (M:

9871144582).

Dr. Farrukh Khan, Mr.

Anup

Kr.

Nagar,

Mr.

Aman

Rai

and

Ms.

Shagun Sarohi, Advocates for R-2 (M

9205029846).

7

WITH

+

W.P.(C) 13758/2021 & CM APPL.43444/2021

STERLITE POWER TRANSMISSION LIMITED ..... Petitioner

Through:

Mr.

Deepak

Khurana

and

Mr.

Abhishek

Bansal,

Advocates

(m:

9811231287).

versus

M/S EPC SOLUTIONS LLP & ANR.

..... Respondents

Through:

Mr.

Dinesh

Kr.

Goswami,

Sr.

Advocate

with

Mr.

Rohit,

Mr.

Prakash Kumar Sinha and Mr. Sushil

Kumar, Advocates for R-1.

Mr. Anuj Aggarwal, ASC with Ms.

Ayushi Bansal, Mr. Sanyam Suri and

17

WITH

+

W.P.(C) 16891/2022 & CM APPL.53523/2022

MUNICIPAL CORPOATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:48

W.P.(C) 16588/2022 & connected matters

Page 2 of 8

RAM PRAKASH

..... Respondent

Through:

None.

18

WITH

+

W.P.(C) 16894/2022 & CM APPL.53541/2022

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

TRIWENI ENTERPRISES

..... Respondent

Through:

None.

19

AND

+

W.P.(C) 16895/2022 & CM APPL.53543/2022

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

M/S TRIWENI ENTERPRICES

..... Respondent

Through:

Ms. Arshya Singh, Advocate for R-2.

20

WITH

+

W.P.(C) 16942/2022 & CM APPL.53675/2022

NBCC (INDIA) LTD.

..... Petitioner

Through:

Mr.

Kartik

Nagarkatti

and

Ms.

Prakriti

Joshi,

Advocates

(M:

9873368749).

versus

MICRO AND SMALL ENTERPRISES

FACILITATION COUNCIL (SOUTH-EAST),

GOVERNMENT OF NCT OF DELHI & ANR.

..... Respondents

Through:

Mr. Avishkar Singhvi, Mr. Naved

Ahmed

and

Mr.

Vivek

Kumar,

Advocates (M: 9654847982).

Ms. Krishna Parkhani, Advocate for

R-2 (M: 7709872128).

21

WITH

+

W.P.(C) 17725/2022 & CM APPL.56669/2022

This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:48

W.P.(C) 16588/2022 & connected matters

Page 3 of 8

RAJA BAHADUR INTERNATIONAL LTD.

..... Petitioner

Through:

Mr. Shubhas Takia, Advocate.

versus

MICRO SMALL ENTERPRISES FACILITATION

COUNCIL AND ORS

..... Respondents

Through:

Mr. Ashish Verma, Advocate for R-3

(M: 9717944394).

37

WITH

+

W.P.(C) 16567/2022 & CM APPLs.52091-92/2022

JKS INFRASTRUCTURE PRIVATE LIMITED

..... Petitioner

Through:

Mr. Dheeraj Sharma and Mr. Bhanu

Gupta, Advocates (M: 9560434606).

versus

MSME FACILITATION COUNCIL AND ORS

..... Respondents

Through:

None.

38

WITH

+

W.P.(C) 16702/2022

M/S ASN ENGINEERS AND ERECTORS

..... Petitioner

Through:

None.

versus

UNION OF INDIA & ORS.

..... Respondents

Through:

Mr. Ravi Prakash CGSC with Mr.

Amit Acharya, GP, Mr. Farman Ali

and Mr. Usha, Advocates for UOI

(M: 8744956276).

39

WITH

+

W.P.(C) 16720/2022

JENENDRA MEDICOS PRIVATE LIMITED

..... Petitioner

Through:

Mr. Pramod Bhardwaj, Advocate.

versus

UNION OF INDIA & ORS.

..... Respondents

Through:

Mr. Ajay Digpaul, CGSC with Ms.

Swati

and

Mr.

Kamal

Digpaul,

Advocates for UOI (M: 9811157265).

Mr. Avishkar Singhvi, Mr. Naved

Ahmed

and

Mr.

Vivek

Kumar,

Advocates (M: 9654847982).

50

WITH

This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:48

W.P.(C) 16588/2022 & connected matters

Page 4 of 8

+

W.P.(C) 276/2023 & CM APPL.1107/2023

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

M/S NATRAJ CONSTRUCTION CO.

..... Respondent

Through:

None.

51

WITH

+

W.P.(C) 277/2023 & CM APPL.1108/2023

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

M/S RAM PRAKASH

..... Respondent

Through:

None.

53

WITH

+

W.P.(C) 294/2023 & CM APPLs.1166-67/2023

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

M/S RAM PRAKASH

..... Respondent

Through:

None.

54

WITH

+

W.P.(C) 300/2023 & CM APPLs.1184-85/2023

SATYA NARAYAN SHARMA

..... Petitioner

Through:

None.

versus

VARISCON ENGINEERING SERVICES PVT. LTD...... Respondent

Through:

Mr. Kailash Chandra, Advocate (M:

9810675135).

55

WITH

+

W.P.(C) 302/2023 & CM APPLs.1188-89/2023

MUNICIPAL CORPORATION OF DELHI

..... Petitioner

Through:

Mr. Kunal Vajani, Mr. Kunal Mimani

This is a digitally signed order.

The authenticity of the order can be re-verified from Delhi High Court Order Portal by scanning the QR code shown above.

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:48

W.P.(C) 16588/2022 & connected matters

Page 5 of 8

and Mr. Kartikey Bhatt, Advocates

(M: 7042492840)

versus

SH. CHHATER PAL

..... Respondent

Through:

None.

CORAM:

JUSTICE PRATHIBA M. SINGH

Advocates:
SHEKHAR DASI

The applicability of the MSME Act to suppliers who are not registered under the Act and to works contracts.

Headnote:

MSME - REGISTRATION - APPLICABILITY - WORKS CONTRACT - [MSME Act, 2006]

Fact of the Case:

The petitioners challenged the reference of disputes to arbitration by the Micro & Small Enterprises Facilitation Council (MSEFC) under the Micro Small and Medium Enterprises Development Act, 2006 (MSME Act), arguing that the suppliers were not registered under the MSME Act and that the MSME Act did not apply to works contracts.

Finding of the Court:

The court directed the MSEFC to provide data on the number of references received, successful conciliations, and disputes referred to arbitration. The court also permitted the respondents to file counter-affidavits on the legal issues raised.

Issues: 1. Whether the MSME Act applies to suppliers who were not registered under the Act at the time of entering into the contract and providing services. 2. Whether the MSME Act applies to works contracts.

Ratio Decidendi: The court did not decide the legal issues raised in the petitions but directed the parties to file submissions on the issues. The court also clarified that the arbitration proceedings would continue subject to the outcome of the writ petitions.

Final Decision: The court adjourned the hearing to March 16, 2023, and directed the parties to file submissions on the legal issues raised.

%

11.01.2023

1.

This hearing has been done through hybrid mode.

2.

All these petitions raise important issues arising out of the Micro

Small and Medium Enterprises Development Act, 2006 (hereinafter ‘MSME

Act’).

3.

The ld. Counsel for the Micro & Small Enterprises Facilitation

Council shall obtain data relating to the number of references received by

the Council since its establishment, the number of matters where

conciliation has been successful, and the number of matters wherein disputes

have been referred to arbitration. The same shall be filed in the form a chart

within one week.

4.

All these matters shall be treated as part heard.

5.

The Registry to list these matters on top of board, under the category

of MSME matters.

6.

Submissions heard.

7.

List on 16th March, 2023.

8.

The first issue raised in this petition relate to the fact that the supplier

was not registered under the MSME Act when the contract between the

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:49

Page 6 of 8

parties was entered and services were provided. Further, the second issue is

that the MSME Act would not apply as the same would apply only in

respect of works contracts. The Respondent disputes this position.

9.

Respondents

are

permitted

to

file

counter

affidavit/

written

submissions on the legal issues raised at least one week before the next date

of hearing.

10.

Parties shall seek an adjournment before the ld. Arbitrator.

11.

List for hearing on 16th March, 2023.

12.

List on 16th March, 2023 along with other MSME matters.

13.

Interim order to continue till the next date of hearing.

14.

The issues raised in this petition are being considered in a batch of

matters. Accordingly, list this matter along with other MSME matters.

15.

It is clarified that no arbitral tribunal shall be constituted till the next

date of hearing.

16.

List on 16th March, 2023

17.

Written submissions/counter affidavit on the legal issues raised may

be filed by both the parties be filed, at least one week before the next date of

hearing.

18.

List on 16th March, 2023 along with all other MSME matters.

19.

Interim order to continue till the next date of hearing.

20.

According to ld. Counsel appearing for the MSEFC, as per the order

dated 3rd November, 2022 passed by this Court in W.P.(C) 13653/2022

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:49

Page 7 of 8

titled M/s STUP Consultants Pvt. Ltd. v. MSEFC & Ors. the question as to

whether a final settlement has been arrived at or not would be an issue

which the arbitral tribunal would have to decide.

21.

It is noticed that the Process Fee is not filed and the Respondents have

not been served.

22.

Issue fresh notice. Registry to also give intimation to all the

Respondents on the email addresses mentioned in the memo of parties.

23.

The interim order passed on 6th December, 2022 shall continue.

Parties to file their counter affidavits/ written submissions on the legal issues

raised by the next date of hearing.

24.

List before the Registrar on 6th February, 2023.

25.

List on 16th March, 2023.

26.

The issue raised in this petition is that works contracts are not

amenable to the jurisdiction of the MSEFC.

27.

Ld. counsel for the Petitioner relies upon the recent judgment of the

Andhra Pradesh High Court dated 26th April, 2022 passed in WP Nos.

27670/ 2022 titled Rashtriya Ispat Nigam Ltd. v. Union of India. These

very issues are also being considered by this Court in various other MSME

matters.

28.

Issue notice.

29.

Mr. Kailash Chandra, ld. Counsel appearing for the Respondent

submits that the Petitioner has not taken any objection before the MSEFC as

to the maintainability of the claims and accordingly cannot claim such an

objection today.

30.

It is made clear that the arbitration proceedings shall continue and

The Order is downloaded from the DHC Server on 28/01/2024 at 11:35:49

Page 8 of 8

shall be subject to the outcome of this writ petition.

31.

List on 16th March, 2023.

32.

None appears for the suppliers.

33.

These petitions are connected with similar matters raising objections

against the reference mad

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